U.S. house inventory down 40% from pre-COVID level
Limited supply is already pushing price growth up, as Zillow's latest market report shows monthly home value appreciation accelerated for the first time since July.
The typical home value is now $320,662, 19.6% above that of December 2020. The annual growth rate represents an all-time high in data dating back more than 20 years. After decelerating since July, month-over-month home value appreciation reignited, jumping from 1.2% in November to 1.4% in December.
The resurgent upward pressure on prices is likely due to astonishingly low levels of inventory this winter. After slipping in November, inventory plunged in December, dropping 11.1% in a month to a new record low of about 923,000 homes. Buyers shopping in December had 19.5% fewer homes to choose from than they did a year before, when inventory was already at a record low. Compared to December 2019, there are now 40.5% fewer homes available for sale.
One bright point for buyers is that the speed of the market has gradually slowed since the frenzied summer. In June, the typical U.S. home spent just one week on the market before going under contract. That has risen every month since, to roughly 13 days in December. This is still an incredibly short time on the market, but those extra few days do give buyers more time to assess their options. ■